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Oerlikon, Applied take aim at First Solar

Post Time:Jul 20,2009Classify:Company NewsView:395

Leading global sellers of turnkey production lines for thin-film solar have been trying to close efficiency gaps and reduce costs to help their customers compete with First Solar.

Executives from Oerlikon Solar and Applied Materials fired away at Tempe, Ariz.-based thin-film giant First Solar (Nasdaq:FSLR) today. But the company wasn´t in the room to defend itself.

Oerlikon Solar’s Christopher O’Brien, head of market development for North America, said his company plans to take advantage of any demand First Solar can’t meet as the Arizona company ramps up its production capability, approaching 1 gigawatt.

Oerlikon wasn´t alone. A group of solar heavyweights from across Europe, the United States and the Middle East echoed similar thoughts at a roundtable discussion hosted by Linde Electronics in San Francisco. The event coincided with the Intersolar North America 2009 convention, taking place this week.

Switzerland’s Oerlikon Solar (VTX:OERL.VX) and Santa Clara, Calif.’s Applied Materials (Nasdaq:AMAT) both offer turnkey production line solutions for thin-film silicon solar (see Oerlikon aims to streamline thin-film solar). They have been trying to close efficiency gaps and reduce costs to help their customers compete against more established players, said Christopher Beitel, Applied’s managing director.

First Solar is considered to be a leader in the thin-film space, manufacturing thin-film solar panels. The company’s cadmium telluride solar panels convert solar energy into electricity, which First Solar claims is more efficient than amorphous silicon solar panels made by its competitors. O´Brien said First Solar has indicated it is facing time constraints and pressure to install faster.

In February, First Solar hit a milestone, reducing its manufacturing costs for its solar modules to 98 cents per watt (see First Solar buys OptiSolar´s pipeline of projects for $400M).

Officials from Applied Materials, Germany-based Masdar PV, which belongs to globally-operating Masdar Abu Dhabi Future Energy, and Oerlikon Solar all acknowledged the hard times throughout the solar industry today thanks to softened demand and difficulty accessing debt. But they also said new market conditions are forcing consolidation and cost efficiency that could benefit the industry in the long run.

“It’s not that people are shutting doors and going home,” O’Brien said. “The expectations of the price of solar are being dramatically shifted.”

The speakers addressed the state of the PV industry, its supply and demand as well as challenges being faced by its various segments, during the Linde-hosted event. Linde Electronics, a subsidiary of the Munich, Germany, parent company Linde Group (ETR:LIN), is a global supplier of ultra-high purity bulk and specialty gases and services to the semiconductor, flat panel display, PV and electronics packaging industries.

Solar took a dramatic nose dive in the second quarter 2009 to its lowest level of investment in more than three years, with only $114 million invested on a global level, down from an all-time high of $1.2 billion invested in the third quarter 2008 (see Cleantech may have seen the worst, rebounding to $1.2B in 2Q09).

It’s difficult to predict how the market is going to reset, the officials said.

“I think gigawatt factories will come back, but obviously there has to be demand,” said Beitel.

Applied has said the economic downturn has made it difficult to finance solar projects or manufacturing lines, directly cutting into its sales in the solar sector (see Applied has ‘a long way to go’ in smart grid tech).

“Material costs need to come down,” Masdar PV’s CEO Rainer Gegenwart said. “We really have to work hard on that.”

Dean O’Connor, Linde Electronics’ global head of market development and technology, said some companies may have gotten ahead of themselves, so the recent pull back could be a good thing.

“I view it as a very nice pause for breath,” he said.

Applied Materials, for one, has been strategizing how to help customers ramp up their factories and drive down costs, said Beitel. Applied is looking downstream to understand what utilities want, working with them as well as end users to build a “thin-film factory ecosystem” where in the United States, China and India, new factories would be installed, creating green jobs and taking advantage of subsidies, he said. He predicted government policies and subsidies are going to shape the future of the thin-film market.

Applied has also been talking about an 80-megawatt factory in the United States, where it would bring a fab to a local area, customers would finance it and then act as the owners and operators of it. He said its owners could be utilities, existing or new players.

Applied thinks its larger solar modules tailored toward the European markets are also going to help drive down the cost of installing thin-film (see ENN Solar makes supersized thin film on first Applied line in China).

In the United States, Applied is focused on system design and partner installations. O’Brien said Oerlikon Solar shares some commonalities with Applied’s business model.

Source: Clean TechAuthor: shangyi

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